Utilities Expenses

Water

Currently, 74.9% of water supplied is used for agricultural purposes, 16.1% for livelihood, and 9% for industrial purposes. In case of drought, the government generally leaves farmlands fallow to ensure adequate water supply for industrial use.

Water fees are lower in Taiwan than in many other countries. The water cost components can be summarized as follows:

Taipei City

The total water fee is comprised of the following charges:

Basic water charge (Include 5% business tax)

Water consumption charge (Include 5% business tax)

Collected on commission

Sewage charge collected on commission

Pumping facility maintenance charge

Water source reciprocation charge collected on commission

Basic Water Charge
The basic water charge is used to finance depreciation and maintenance of water production, treatment, and supply facilities. It is determined by the caliber of the feeder supply pipe connected to the water meter and is independent of the water consumption level. The fee is as follows:

Unit: NT$/per month

Water meter pipe caliber (mm)

Basic water charge

13

17

20

68

25

126

40

374

50

680

75

1,836

100

3,638

150

10,098

200

20,060

250

35,428

>300

55,590

Source: Taipei Water Department

Water Consumption Charge
The water consumption charge is levied at progressive rates and is based on the consumption level as follows:

Unit: NT$/per month

Consumption level Consumption and fee rate

Water usage

Water Consumption (cubic meters)

1-20

21-60

61-200

201-1,000

>1,001

Rate (NT$/cubic meter)

5.00

6.70

8.50

14.00

20.00

Progressive Difference (NT$)

0

34

142

1,242

7,242

Source: Taipei Water Department

Waste Disposal Charge Collected on Commission
The Taipei Water Department collects NT$3.7 for each cubic meter of water consumed by users in certain areas of Taipei County, including Sindian, Jhonghe, Sanchong, Sijhih and Keelung. Residents in Taipei City do not pay this charge.

Sewage Charge Collected on Commission
This charge is paid for sewage treatment. The unit rate for both business and non-business users is NT$5 per cubic meter.

Pumping Facility Maintenance Charge
Pumping operations are used to supply water to remote and high-elevation areas, specifically hill slopes and mountain areas. Certain areas may require more than one tier of pumping operations, resulting in the need to apportion some of the costs to water users in such areas to defray maintenance costs of the pumping facility, part of which is subsidized by the Taipei City government. The pumping charge per cubic meter is as follows:

Unit: NT$/cubic meter

User’s Location

Pumping Tier

1

2

3

4

5

Taipei City

2.5

5.5

8.5

11.5

14.5

New Taipei City

3.5

6.5

9.5

12.5

15.5

Source: Taipei Water Department

Water source reciprocation charge collected on commission
Restrictive and control measures have been adopted to preserve water source areas, thus affecting the rights and interests of affected inhabitants. The water source reciprocation charge, total quantity of water used (in cubic meters)*0.5, is collected to help finance public projects in affected areas.

Taiwan Province and Kaohsiung City

The total water fee is comprised of the following charges:

Basic water charge

Water consumption charge

Waste disposal charge collected on commission

Water source reciprocation charge collected on commission

Basic Water Charge (5% VAT included)

Unit: NT$/per month

Water meter pipe caliber (mm)

Basic water charge

13

17.85

20

35.7

25

66.15

40

196.35

50

357

75

963.9

100

1,909.95

150

5,301.45

200

10,531.5

250

18,599.7

300

29,184.75

350

41,626.2

≧400

58,119.6

Source: Taiwan Water Corporation

Water Consumption Charge (5% VAT included)
The water consumption charge is based on the consumption level and is levied at progressive rates as follows:
Water Consumption Charge=Consumption Level × Progressive Rates － Progressive Difference

Water source reciprocation charge collected on commission
As noted above, restrictive and control measures have been adopted to preserve water source areas. The water source reciprocation charge, at a surcharge (5%) on the water charge (excluding VAT), is collected to help finance public projects in affected areas.

Electricity

To ensure the future supply of electricity to this densely populated and highly industrialized country, Taiwan Power Company (TPC) has been persistently expanding its power system to meet the ever growing demand. The installed capacity was 41,037 MW as of 2015. To vitalize the electricity market and also encourage the competition, the government started awarding the permit to private Independent Power Producer (IPP) in 1995. Nine private thermal power plants had been commissioning since then with installed capacity being 7,650 MW by the end of 2015. With sufficient reserve margin at hand, a shortage of power is not a particular issue in Taiwan. Moreover, the government has been implementing a "999 plan" since July 2005, the reliability and quality of power supply can be further secured.

Installed nameplate capacity

Classification

Installed nameplate capacity (KW)

Constituent ratio (%)

Increase Rate compared with last year (%)

Pumped-storage water

2,602

6.3

0.0

Fossil-fuel power

29,268

71.3

-1.9

Neclear

5,144

12.5

0.0

Renewable energy

4,023

9.8

6.6

Total

41,037

100.0

0.6

Note: 4,023KW of Renewable energy includes 2,089KW of hydroelectric power, 642KW of wind power, 669KW of solar energy and 623KW of others.

The electricity charge to industrial and commercial customers with larger loads includes two parts, namely, the demand charge and energy charge. Because Taiwan is geographically located in a sub-tropical region, the demand for electricity is much higher in summer than in winter. Besides, the loads appear fluctuation in different time periods. To cope with the cost reflective principle, the tariff is differentiated by seasons and time of use as follows:

Regular Service (Non-TOU) rate: the rate differs in summer and non-summer. Summer is the period from June 1 to September 30, and non-summer is the rest of the year.

Time of Use (TOU) rate: In addition to the different rates for summer and non-summer months, there are different rates for different periods, i.e. peak period, off-peak period, partial-peak period, and Saturday partial-peak period.

Electricity services can be divided into low tension and high tension. Below is the table used to determine which electricity services are applicable for a particular purpose:

Type of Service

Classification

Applicability

Sample

Low Tension Service

Power Service

For lights, small appliances, and power used for industrial/non-industrial purposes with contracted demand of less than 100 kW